Mustapha Mansouri, Morroco's minister for employment and professional training, has said that the government expects economic growth of 3.5 to 4 per cent in 2007, allowing for the creation of 300,000 jobs.

According to an official report early this year, the kingdom needs to create 400,000 jobs per year over the next ten years to prevent mass unemployment that could threaten its stability.

"You need a performance of 5 to 6 per cent [growth] to create enough jobs for those people arriving on the work market and to eat a little into the backlog of existing jobless." Mansouri told Reuters in an interview.

For the year 2006, the government sees growth rate of 7.5 per cent and Mansouri said that would allow unemployment to fall to about 8 or 9 per cent from 11 percent in 2005.

With 2007 an election year, the ruling coalition of technocrats, conservatives and socialists is keen to show voters that reforms including public sector payroll cuts and more flexible labour rules are beginning toprove successful. 

Employment reality 

Official employment data may differ widely from the reality on Morocco's streets due to a vast informal economy which, according to some estimates, is even bigger than the formal sector.

"Unfortunately our system of education continued to train generalists who were no longer able to find a place in the productive system"

Mustapha Mansouri, the Minister for employment and professional training

Working out who is employed is not easy in a country full of family-run shops, makeshift stalls offering fruit or toys, men wandering the streets offering to shine shoes or dispose of scrap metal, and where factory workers are hired and fired as contracts come and go.

Morocco's formal employment sector has its own problems after the education system failed to adapt to a rapidly-changing job market.

Young graduates have been left unemployed as public sector payroll cuts barred the door to state employment, and weak levels of investment meant few private sector jobs.

"Unfortunately our system of education continued to train generalists who are no longer able to find a place in the productive system," said Mansouri.

He said education was being reformed and the government planned to spend $228 million over three years to train Moroccan graduates and to help 30,000 of them set up their own companies.

About 5,000 have already applied since the scheme was introduced a few months ago, he added.

The government says it is addressing problems of an ill-adapted education system, poor infrastructure, bureaucracy, slow justice and high payroll taxes that have put firms off investing in job creation.